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ADB's $50-mn loan to support policy reform to boost trade in Cambodia

27 Nov '24
2 min read
ADB's $50-mn loan to support policy reform to boost trade in Cambodia
Pic: Adobe Stock

Insights

  • The Asian Development Bank recently approved a $50-million policy-based loan to support Cambodia's efforts to make its business environment more investment-friendly, upgrade businesses towards higher competitiveness and ease trade barriers.
  • It focuses on MSMEs, which will be empowered through targeted incentives to diversify, integrate digital solutions, and increase productivity.
The Asian Development Bank (ADB) recently approved a $50-million policy-based loan to support Cambodia’s efforts to make its business environment more investment-friendly, upgrade businesses toward higher competitiveness and ease trade barriers.

This second sub-programme of the ongoing Trade and Competitiveness Programme is reinforcing the government’s efforts to leverage private sector investments to achieve higher, inclusive and sustainable growth.

“This program supports ADB’s continued commitment to advancing Cambodia’s economic potential and creating a more robust enabling ecosystem for business to grow, leading to increased investment, job creation, and sustainable economic growth,” said ADB country director for Cambodia Jyotsana Varma.

“It focuses on micro, small, and medium-sized enterprises (MSMEs) as they are the backbone of the economy, and their growth is crucial to drive competitiveness. Through targeted incentives, we aim to empower them to diversify, integrate digital solutions, and increase productivity,” she said in an official release.

“This programme also seeks to facilitate smoother, more efficient cross-border trade by improving regulatory frameworks, streamlining procedures, and reducing barriers to trade, leading to Cambodia being better positioned to participate in regional and global markets,” she added.

There are three main interlinked constraints contributing to Cambodia’s broader development challenges: a sub-optimal enabling environment for investment and business, underdeveloped MSMEs, and barriers to cross-border trade. Combined, they reduce productivity and competitiveness and prevent the economy from fully realizing its growth potential.

The programme supports the government’s efforts to address these challenges and boost Cambodia’s competitiveness. It will help streamline business regulations and enhance public services, making it easier to do business in Cambodia.

By 2027, the programme would lead to some 50,000 MSMEs being formally registered in the online business registration system, and digitally secure necessary business licenses, certificates and permits.

In parallel, the programme provides incentives and technological support to MSMEs to encourage them to expand in strategic sectors and move up the value chain. It also supports flagship reforms to improve border facilitation to boost trade.

Fibre2Fashion News Desk (DS)

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